Jokowi calls on fintechs to adopt good governance for improved cybersecurity and services – business
Riska Rahman (The Jakarta Post)
Sun 15 November 2020
President Joko “Jokowi” Widodo called on financial technology (fintech) companies to practice good governance and accountability to mitigate the risks associated with rapid technological developments in the financial sector.
In his pre-recorded remarks at the opening of the 2020 Indonesian Fintech Summit on Wednesday, Jokowi said fintech service providers should remain cautious about certain security risks such as cybercrime, disinformation, transaction errors and misuse. data that could affect the quality of their services.
“Fintech players should implement good governance and accountability to mitigate these risks,” the president said, especially since the non-banking sector was not as tightly regulated as the banking sector.
“This way, [fintechs] can provide secure services to customers and make a great contribution to micro, small and medium enterprises [MSMEs] as well as the national economy, ”he said.
According to an earlier report by the National Cyber and Encryption Agency (BSSN), Indonesia recorded more than 88 million cyber attacks in the first four months of the year, with March recording the highest daily average of cyber attacks.
Several online marketplaces and fintech platforms suffered data breaches this year. More recently, on October 28, financial technology aggregator Cermati.com was the victim of a data theft that obtained the data of nearly 3 million users who were sold online for US $ 2,200. The data theft was revealed on November 1 in a tweet posted by researcher and cybersecurity consultant Teguh Aprianto on his Twitter account, @secgron.
Cermati.com is the second fintech platform to suffer a data breach this year, following the data breach of approximately 890,000 Kreditplus users in August.
The Financial Services Authority (OJK) has pushed the House of Representatives to conclude its deliberations on the personal data protection bill to prevent and resolve such cases, President Wimboh Santoso said at the summit on Wednesday.
Indonesia has no regulations in place to allow law enforcement to prosecute offenders data breaches, theft or misuse. The Electronic Transactions and Information Act 2008 only allows victims of cyber attacks to seek compensation for breach of their personal data.
“The measure is not sufficient punishment, and we hope that the [data protection] invoice can deter people from misusing customer personal data, ”Wimboh said.
The Indonesian FinTech Association (Aftech) has long been pushing for passage of the bill, with Aftech chief executive Mercy Simorangkir saying last year that the bill was vital in moving the industry forward in more responsible management.
The government has placed its hopes in fintech companies to help drive financial inclusion through to its 2024 target of 90%. Indonesia’s financial inclusion rate in 2019 was 76%, lower than the rate of other Southeast Asian countries like Singapore (98%), Malaysia (85%) and Thailand (82% ).
Data from the OJK also showed that Indonesians were consistently ranked low in digital financial literacy. Only 35.5% of the population demonstrated familiarity with digital financial services (DFS) last year, while only 31.26% of Indonesians used DFS.
“I hope fintech innovators don’t simply become lenders and online payment service providers. They should also continue to grow to provide other functions such as aggregation, crowdfunding and project finance services, ”said the president.
Finance Minister Sri Mulyani Indrawati added during the opening ceremony that the government is committed to supporting such efforts by developing more information and communication technology (ICT) infrastructure to expand the nationwide Internet access.
Sri Mulyani said the government has allocated 413 trillion rupees ($ 29.17 billion) to build ICT infrastructure for digital development and 30 trillion rupees to develop digital technology. The ICT infrastructure allocation included the construction of basic transmission receivers in over 5,000 villages and 12,377 other locations not yet connected to Internet networks.
“The terms outermost regions, marginalized or left behind will no longer be used in connection with the Internet connection,” she said.
Bank Indonesia (BI) Governor Perry Warjiyo also expressed the central bank’s commitment to achieving the country’s goal of financial literacy and inclusion, even as the BI pursued its own digital transformation.
The central bank has so far adopted several digital technologies as part of its digital transformation, including the QR Indonesia (QRIS) standard for digital payment services and an open banking application programming interface (API) to facilitate ‘interconnectivity between banks and fintechs.
“We also continue to promote digital banking, grow the retail payments ecosystem, and lead our own regulatory reform to build agile policies that support the fintech industry,” said Perry.